Share this
Twitter
Myspace
Digg
Del.icio.us
Yahoo
Newsvine
Googlize this
Facebook
Hear this text
E-mail
NEWSLETTER July 2009
THE home building industry is on the point of implosion in NSW and Victoria, one of the longest-running building companies in the country has warned in a scathing open letter to state and federal governments in April this year.
Glenvill Homes spent six tortuous months attempting to secure home builders warranty insurance from Lumley General so it could continue operating. The situation is untenable said Stephen Bloch, Glenvill's strategic and development manager. Volume builders will not tolerate it further.
"We will not have our businesses hijacked by the dictates of the insurance industry … If the government is simply incapable of appreciating the commercial realities we face, then you will witness the industry slowly implode."
This month started really badly with the news that Lumley General will depart the warranty market immediately and only provide project certificates until 31st December 2009
To make matters worse we then receive the news that CGU will also that CGU will also leave the market and only provide project certificates until the 30th of November 2009
So why did they leave if it is so profitable and where does that leave the builders who were insured with these entities that were to be the panacea to the warranty issues. They left because Vero dominate the market and they can’t gain sufficient market share to warrant the exposure to such a controversial product that may in fact be illegal. Remember your securities are not transferable and many builders already have securities tied up with more than one insurer. Some have no more assets to pledge.
Vero and HIA say all is well and insurance will be available to all who meet the criteria. Keep in mind these are the same words that were used post HIH by the same entities.
This is what Glenvill Builders had to say about our trade associations in their latest letter to Government at point 8:
“Finally it was resolved that whilst the HIA (Australia and the MBA (Victoria) have the confidence of the group (Volume Builders) in relation to training, education, OH&S courses and the like, they are decidedly NOT a voice with respect to the advocacy of the issues above (Warranty Issues) and if he Government insists on dealing with the exclusively than a further challenge will be mapped out to address this concern as well.”
So what do we do now?
If you were with these insurance companies, then apply immediately to the remaining insurers who are Vero, QBE, and Calliden. They are your only choices, and let us know of the outcome. Write and or speak to your local politician. Demand action from HIA and or MBA. HIA say no one is concerned and the issue has not even been mentioned!!! Is this the case?
Speak out because the past is about to revisit, do I need to remind you of 2001-02-03 when we couldn’t work.
New layer...